We investigate the extent to which start-ups use outside equity, and interpret our results in relation to financial contracting theory. We do so by studying the start-up and founder characteristics that are associated with the use of outside equity financing, using a unique dataset from Norway....

Stock market investment decisions of individuals are positively correlated with that of co-workers. Sorting of unobservably similar individuals to the same workplaces is unlikely to explain our results, as evidenced by the investment behavior of individuals that move between plants. Purchases...

How large is entrepreneurs' personal importance to startups? We use the death of nearly 1,500 entrepreneurs as a source of variation, and find large and sustained negative effects on growth and profitability. For small startups, the effects go mainly via firm survival, while for larger startups...

Experiments typically rely on small payments to incentivize participants. This works if participants view these payments as fungible with their own money, but if participants view the payments as a windfall, they may behave differently in experiments than in real life. We modify standard risky...

Overstaffng appears to be a source of signi cant ineffciencies in organizations, but there is little economic theory that informs us why. We extend the canonical Lazear-Rosen tournament model to a dynamic setting that yields overstaffng at the managerial level. Overstaffng can be optimal in...

We document three new facts about entrepreneurship. First, a majority of male entrepreneurs start a firm in the same or a closely related industry as their fathers' industry of employment. Second, this tendency is correlated with intelligence: higher-IQ entrepreneurs are less likely to follow...

We document three new facts about entrepreneurship. First, a majority of male entrepreneurs start a firm in the same or a closely related industry as their fathers' industry of employment. Second, this tendency is correlated with intelligence: higher-IQ entrepreneurs are less likely to follow...

We consider a financing game with costly enforcement based on Townsend (1979), but where monitoring is non-contractible and allowed to be stochastic. Debt is the optimal contract. Moreover, the debt contract induces creditor leniency and strategic defaults by the borrower on the equilibrium...

What determines the quality of entrepreneurs? To address this question, the paper proposes a simple model of the interaction between individual workers' decision to become entrepreneurs and established firms' effort to keep their best workers and ideas. The main prediction from the model is that...

We study the effects of broadband internet use on the portfolio selection of individual investors. A public program in Norway provides plausibly exogenous variation in internet use. Our instrumental variables estimates show that internet use causes a substantial increase in stock market...